Those who pay their taxes late can expect punishment – but there is such a thing as a reasonable excuse. In one case, a man who failed to notify the tax authorities of his obligation to pay the High Income Child Benefit Charge was relieved of financial penalties by the First-tier Tribunal (FTT).

Over a period of about five years, during which his annual earnings were in excess of £50,000, the man should have paid the charge. He failed to notify HM Revenue and Customs (HMRC) of his liability. He was ultimately required to pay the full amount of tax due, plus interest and late-payment penalties totalling £1,350.

HMRC pointed out that there was an extensive publicity campaign before the charge was introduced in 2013. The man had been sent letters alerting him to the charge, and the onus was on him to notify HMRC of his liability, rather than the other way around. The penalty had been correctly assessed and calculated on the basis that his delay in notifying his liability was non-deliberate.

In overturning the penalties, however, the FTT accepted that he was unaware during the relevant period that his partner was claiming Child Benefit. He had not needed to complete personal tax returns because all of his earnings were taxed via the PAYE system. Due to postal difficulties, he had not received two of HMRC’s letters. When he became aware of his liability, he swiftly paid the tax due, plus interest. Overall, he had a reasonable excuse for his delay in notifying HMRC of his liability.


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